Criminal Justice News

Wednesday, July 25, 2012

Co-Owners of Houston-Area Durable Medical Equipment Company Sentenced to Prison for Role in $1.18 Million Medicare Fraud

Each Defendant to Serve 87 Months in Prison

WASHINGTON – The former co-owners of a Houston-area durable medical equipment (DME) company were sentenced today in Houston to each serve 87 months in prison for their participation in a $1.18 million Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

Clifford Ubani, 54, and Princewill Njoku, 53, the former co-owners of Family Healthcare Services, were sentenced by U.S. District Judge Gray H. Miller in the Southern District of Texas in Houston. In addition to their prison terms, each was sentenced to serve three years of supervised release and ordered to pay $566,451 in restitution jointly and severally with their co-defendants. In September and October 2010, respectively, Ubani and Njoku pleaded guilty to one count of conspiracy to commit health care fraud.

In June 2011, Ubani and Njoku were each sentenced to serve 108 months in prison for their roles in a separate $5.2 million home health care fraud scheme. Today’s sentences and the previously imposed sentences will be served concurrently.

According to court documents and other evidence presented to the court, Family, a Houston DME company, purported to provide medical equipment to Medicare beneficiaries. According to court documents, Ubani paid co-conspirators to recruit Medicare beneficiaries for the purpose of Family filing claims with Medicare for DME that was medically unnecessary or not provided. In particular, Family would bill Medicare for unnecessary medical orthotic braces that were marketed as “arthritis kits” or “ortho kits.” The co-conspirators would then falsify documents to support the fraudulent payments from Medicare.

Ubani and Njoku are the third and fourth defendants sentenced in connection with this scheme. One other defendant, Michelle Turner, awaits sentencing following her February 2012 conviction after a one-week jury trial.

The sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; Special Agent-In-Charge Stephen L. Morris of the FBI’s Houston Field Office; Special Agent-in-Charge Mike Fields of the Dallas Regional Office of HHS’s Office of the Inspector General (HHS-OIG) and the Texas Attorney General’s Medicaid Fraud Control Unit (OAG-MFCU).
This case is being prosecuted by Trial Attorney Charles D. Reed and Deputy Chief Sam S. Sheldon of the Criminal Division’s Fraud Section. The case was investigated by the FBI, HHS-OIG, Texas OAG-MFCU and the Federal Railroad Retirement Board-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,330 defendants who have collectively billed the Medicare program for more than $4 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.